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026_ Interview: when american made capsizes

12 September, 2021 - 2 min read

026_ Interview: when american made capsizes

I’m going to start this episode with a definition to set some of the stage.

What, is an industry?

When people refer to this or that quote, industry, what is the idea they are modeling when they say that?

It’s a conglomeration of companies, that sell products or services within a specific domain.

Companies that sell birdseed, would be in the home and garden industry.

While those that sell dog food, the pet industry, so on and so forth.

Now, what would happen to an industry, if the rules of where something can be made, were artificially held in place?

How would that industry, again that conglomeration of companies, and the market, those people and companies that are interested in purchasing that industry’s goods, react if there was such an artificial control?

Well look no further than this episode and America’s domestic shipping industry, and more specifically the Jones Act, or the artificial control in place that mandates all ships being used to transport goods domestically in the US, be built in America and operated by mostly americans.

What the reasoning was when this Act was put in place, and how far the US has fallen since the industrial revolution in ship building globally, set the stage for the modern pushback and general lazy obedience to the status quo argument and political will.

As my returning guest Colin Grabow details, forcing ships to be built in America only, breeds a lack of specialization into the US’ ship yards, which then means a lack of efficiency and lack of standardization, which are all the hallmarks of not just better products, but reduced cost.

As such the US builds a dizzyingly slow number of ships each year despite the size of water domestically and wealth of the nation.

It’s a truly fascinating example to be brought into a thought around the role of government and how products get made, and made well.

And with that, I’ll bring us to my Interview with senior fellow at the cato institute, Colin Grabow.

-J.R.

This was an excerpt from the intro essay to _bandwidth: coast to coast

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